[Congressional Record Volume 162, Number 84 (Thursday, May 26, 2016)]
[Senate]
[Pages S3270-S3272]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        COMMENDING JOHN KOSKINEN

  Mr. CARPER. Mr. President I want to take another few minutes--I think 
I have the time. I don't see anybody waiting to speak. I want to take a 
minute and say something about a fellow named John Koskinen. John 
Koskinen is the Commissioner of the IRS. In 2013, at a time of great 
tumult at the IRS, President Obama turned to John Koskinen to lead the 
IRS because of his reputation in the public and private sectors as a 
go-to manager of troubled enterprises.
  He was 74 at the time. He agreed to take this on. He did not need to 
do this. He needed to do this job like he needed another head, but he 
said that he would do it. He agreed to do it because the President 
asked him to serve our country, and they needed a strong leader at the 
IRS.
  Prior to his service at the IRS, he held the position of Non-
Executive Chairman at Freddie Mac from September 2008 to December 2011. 
During that time he served as the interim CEO at Freddie Mac--that was 
a tumultuous time, a very difficult time for our country--and as the 
principal financial officer after the death of Freddie Mac's acting CFO 
in April of 2009.
  He retired from the Freddie Mac board in 2012. I want to mention 
another thing or two about John Koskinen's service prior to coming on 
board in the last decade to help us in the public sector. Prior to 
serving on the Freddie Mac board, Koskinen served as the president of 
the U.S. Soccer Foundation from 2004 to 2008. He also previously served 
as deputy mayor of the District of Columbia, the Deputy Director for 
Management at the Office of Management and Budget, and the Chairman of 
the President's Council on Year 2000 Conversion.
  Prior to entering government service, John Koskinen worked for 21 
years for the Palmieri Company, as vice president, president, CEO and 
chairman, working in the realm of turnarounds--a person helping to turn 
around large failed enterprises. Earlier in his career, he served as 
the administrative assistant to then Senator Abraham Ribicoff, 
legislative assistant to Mayor John Lindsay, and Assistant to the 
Deputy Executive Director of the National Advisory Commission on Civil 
Disorders.
  He practiced law with the firm of Gibson, Dunn & Crutcher and clerked 
for Judge David Bazelon, chief judge of the U.S. Court of Appeals for 
the District of Columbia.
  He got his bachelor's degree from Duke University and his law degree 
from Yale. I mean, what a resume.
  At the age of 74, as somebody who helped turn around a lot of failed 
enterprises, our President reached out to him and probably said: I know 
you are 74, an age where a lot of people are more interested in slowing 
down and taking life easy. He took on one of the toughest challenges of 
all.
  He is one of the finest people I know in public service. There are 
some folks in the Congress who have been asserting that he is unfit for 
service. I just want to say: They could not be more mistaken. This a 
good and decent man. I was raised to treat other people the way I want 
to be treated, to figure out the right thing to do, and to treat others 
the way I want to be treated.
  Given the sacrifices that he has made with his life at this stage of 
his life, rather than taking brickbats, he should be taking bouquets. 
So I would say to you, John Koskinen, if you are out there listening: I 
know you have other things to do rather than listen to wrapups here in 
the Senate before we begin the Memorial Day break, but I want to say 
thank you for a lifetime of service, and thank you especially for your 
service as our leader in the IRS. God bless you and your family. Thanks 
to them for sharing with us a very good human being.
  Mr. President, I ask unanimous consent to have printed in the Record 
a letter dated May 23, 2016, from John Koskinen, Commissioner of the 
IRS, whom I was just discussing, to the Honorable Bob Goodlatte, 
chairman of the Committee on the Judiciary in the U.S. House of 
Representatives.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                       Department of the Treasury,


                                     Internal Revenue Service,

                                     Washington, DC, May 23, 2016.
     Hon. Bob Goodlatte,
     Chairman, Committee on the Judiciary,
     House of Representatives, Washington, DC.
       Dear Mr. Chairman: Thank you for your letter of May 18 
     inviting me to testify at the Judiciary Committee hearing on 
     May 24 regarding the Committee's inquiry into allegations 
     made against me in my role as IRS Commissioner. I thank you 
     for extending me that courtesy, and for affording me the 
     opportunity to provide the Committee with information in 
     response to the issues raised by some Members of the House. I 
     have the deepest respect for you and for this Committee, and 
     recognize your Committee's responsibility to carefully 
     evaluate these allegations.
       When the Committee announced this hearing, I was returning 
     from a week in China where I met with the tax administrators 
     of 43 nations to discuss international tax avoidance issues. 
     As a result, since I returned, my schedule has been more 
     crowded than usual, including preparations for a previously 
     scheduled hearing before the House Ways and Means Committee 
     on Wednesday, May 25. Therefore, the short notice provided 
     has left me without sufficient time to prepare to appear in 
     person on Tuesday for what could be a wide-ranging and 
     complex discussion regarding claims that may only become 
     clear after the hearing's first panel. Thus, while I must 
     regrettably decline your invitation, I remain willing to 
     appear before the Committee in the future.
       In the meantime, if you think it is appropriate and helpful 
     to include in the record at this time, I enclose an initial 
     statement summarizing why the allegations against me lack 
     merit. I think this information may also be useful to 
     witnesses at the second hearing you have announced for June 
     with outside experts.
       Should the Committee choose to undertake further steps, I 
     hope that it will do so in a manner consistent with the 
     House's longstanding concern for, and provision of, the due 
     process that must attend such a serious course of action. I 
     would be pleased to talk with you further at your 
     convenience.
           Sincerely,
     John A. Koskinen.
                                  ____


 Written Statement of John A. Koskinen, Commissioner, Internal Revenue 
    Service Before the House Judiciary Committee--for Its Hearing: 
 Examining the Allegations of Misconduct Against IRS Commissioner John 
                     Koskinen, Part I May 24, 2016


                              InTRODUCTION

       Chairman Goodlatte, Ranking Member Conyers and Members of 
     the Committee, thank you for the opportunity to provide a 
     summary statement for the record in connection with your 
     review of the allegations by some Members of the House 
     Oversight and Government Reform Committee. I hope this 
     summary statement is helpful as you consider whether to 
     initiate a more formal inquiry. I stand ready to cooperate 
     with your Committee with regard to any actions it deems 
     appropriate.
       I have great respect for our institutions of government, 
     including the United States Congress and each of its Members. 
     When I began my service as Commissioner of the Internal 
     Revenue Service, I took over an agency under investigation by 
     six different bodies

[[Page S3271]]

     and buffeted by ongoing, serious controversy. I regret that, 
     in the period since then, we have not been able to bring 
     these matters to a conclusion satisfactory to all Members of 
     this distinguished Body, including those who are testifying 
     today before you.
       I believe the allegations you will hear described today, 
     and the related House Resolution are without merit, for 
     reasons summarized below. But I also acknowledge the strong 
     feelings that are held by some Members regarding this matter, 
     as well as their understandable frustration with the document 
     production and retention challenges of our agency during the 
     past several years. I also understand their deep concern 
     regarding the actions that gave rise to these controversies 
     --conduct that ended long before I arrived at the IRS. I am 
     committed to continuing to make improvements and working with 
     all committees and Members of Congress during my tenure as 
     Commissioner, and I sincerely hope that, over time, trust and 
     goodwill on all sides will be restored.


                               BACKGROUND

       Let me begin by noting that I never sought the position of 
     IRS Commissioner, which I have held since December 2013. 
     After concluding my work as Non-Executive Chairman of Freddie 
     Mac, having been asked to undertake that role in the wake of 
     the financial crisis by President George W. Bush's 
     Administration, I was happily retired. I served on the boards 
     of two large, publicly-traded companies and tried to keep up 
     with my grandchildren. But I agreed to serve when approached 
     by the current Administration in May 2013, because I have a 
     longstanding commitment to public service, and because I 
     understand the importance of the IRS to the government and 
     the nation. The IRS collects more than 90 percent of the 
     revenue that funds the operations of the Federal government, 
     and the agency's activities touch virtually every American.
       When I came to the IRS, I knew no one who worked at the 
     agency, and to this day I have never met or spoken to former 
     IRS Director of Exempt Organizations Lois Lerner. By the time 
     I was confirmed as Commissioner in December 2013, six 
     investigations were already well underway in response to the 
     May 2013 report by the Treasury Inspector General for Tax 
     Administration (TIGTA) regarding the use of improper criteria 
     to process applications for tax-exempt status under section 
     501(c)(4) of the Internal Revenue Code.
       It should be noted that organizations applying for 
     501(c)(4) status at that time did not need a determination 
     from the IRS to undertake their activities. Until last 
     December, when Congress passed the Protecting Americans from 
     Tax Hikes (PATH) Act--which requires 501(c)(4) organizations 
     to advise the IRS when they begin activities--any entity 
     could operate as a 501(c)(4) simply by filing the annual 
     information returns required by the IRS. Nonetheless, those 
     organizations had a right to a determination if they sought 
     it, and the IRS had an obligation to provide that 
     determination promptly and efficiently. Early in my tenure, I 
     apologized to all groups who experienced inordinate delays 
     and complications in the review of their applications.
       My goal from the start has been to respond as quickly and 
     completely as possible to inquiries from any of the six 
     investigating entities, to help them develop recommendations 
     that would in turn assist us in ensuring that the management 
     failures described in TIGTA's May 2013 report would never 
     happen again.
       My previous experience in government helped me to 
     understand the importance of complying with such 
     investigations. Earlier in my career, I spent four years as 
     Chief of Staff to former Sen. Abraham Ribicoff, who served as 
     Chairman of a subcommittee of the Senate Governmental Affairs 
     Committee and, ultimately, as Chairman of the Committee. The 
     Committee held hearings on a variety of important issues, and 
     my involvement in those hearings impressed upon me the 
     importance of Congressional oversight of the Executive 
     Branch, and the responsibility of agencies to respond as 
     quickly and completely as possible to requests for 
     information from Congress.
       In response to the May 2013 TIGTA report, the IRS accepted 
     and implemented all of the Inspector General's 
     recommendations, with one exception. The only recommendation 
     we have not completed involves clarifying how to measure the 
     social welfare and political activities of section 501(c)(4) 
     organizations. Before I became Commissioner, the Treasury and 
     the IRS drafted proposed regulations on this issue for public 
     comment. The regulations proved to be very controversial and 
     provoked over 160,000 comments. I suggested that we start 
     over, taking into consideration the range of comments 
     provided and emphasizing that our goal was not to change the 
     basic, existing rules but, instead, to clarify them as 
     recommended by the TIGTA report. We were instructed by 
     Congress in December to halt our work in this area, which we 
     have done.
       TIGTA reviewed our actions in response to the May 2013 
     report, and issued a follow-up report in March 2015 that 
     noted the IRS had taken ``significant actions'' to address 
     their recommendations. We also accepted and implemented their 
     additional suggestions.
       In August 2015, another of the six investigating entities, 
     the Senate Finance Committee, concluded its two-and-a-half 
     year investigation with an exhaustive report. As I testified 
     to the Finance Committee in October last year, the IRS 
     accepted all the recommendations in the Committee's report 
     that were within our control--those that did not involve tax 
     policy matters or legislative action. They included 15 of the 
     report's 18 bipartisan recommendations. We also accepted and 
     have implemented all of the recommendations within our 
     control in the separate reports prepared by the Majority and 
     Minority of the Committee.
       In addition to the Senate Finance Committee, the Senate 
     Permanent Subcommittee on Investigations, the Department of 
     Justice (DOJ), and TIGTA have concluded their investigations 
     and their work, with the exception of one historical review 
     being done by TIGTA. None of these entities have indicated 
     any further action or activity is necessary or required.
       Despite that, some Members have urged the House to impeach 
     me. Impeachment is, of course, an extraordinary tool, used 
     very rarely by the House after a careful and deliberative 
     process, including, in previous cases, providing substantial 
     due process and other safeguards to the accused individual. 
     These safeguards, which include adequate time to prepare and 
     the right to call and examine witnesses, are not part of this 
     preliminary inquiry. And as described below, I believe 
     impeachment is a wholly improper tool in this instance.


  RESPONSES TO THE ALLEGATIONS IN THE PROPOSED ARTICLES OF IMPEACHMENT

       As indicated earlier, I believe there is no substance to 
     any of the four charges put forward by some Members of the 
     House Oversight and Government Reform Committee. My responses 
     to these allegations can be summarized as follows:

                           Proposed Article I

       The IRS, under my direction, responded to Congressional 
     requests for information with a massive production of 
     documents.
       Both TIGTA and DOJ have determined that the erasure of 
     disaster recovery tapes was an accident.
       No one has even suggested, nor could they suggest, that I 
     was somehow personally involved in the erasure of the tapes.
       The IRS has taken steps to prevent a repeat of the failure 
     to preserve information.
       Under my direction, the IRS has responded comprehensively 
     and in good faith to the various subpoenas and document 
     requests from the investigating entities.
       Despite historically low levels of funding, the IRS 
     incurred more than $20 million in expenses (and devoted more 
     than 160,000 man-hours) to collect, review, and produce 
     approximately 1.3 million pages of documents. As part of this 
     massive document production, the IRS recovered and produced 
     over 78,000 emails that were sent or received by former IRS 
     Director of Exempt Organizations Lois Lerner, including over 
     24,000 emails from the period affected by Ms. Lerner's hard 
     drive crash.
       The IRS was able to recover such a large number of emails 
     by looking in the places where it believed the emails were 
     most likely to be found: in the email accounts of IRS 
     employees that Ms. Lerner worked with or supervised. The 
     IRS's strategy was to make up for any technical or 
     recordkeeping shortcomings that may have existed by pursuing 
     a broad, even redundant, document collection and review 
     effort.
       The erasure of 422 disaster recovery tapes at Martinsburg, 
     West Virginia was clearly a failure of the IRS's document 
     preservation protocols. The IRS accepts responsibility for 
     it, and as detailed in its submissions to Congress, has 
     improved employee training and taken other measures to 
     minimize the risk that anything like this could ever happen 
     again. However, both TIGTA and DOJ agreed that the erasure 
     was an accident. As TIGTA stated in its investigative report, 
     its extensive interviews ``provided no evidence that the IRS 
     employees involved intended to destroy data on the tapes or 
     hard drives in order to keep this information from Congress, 
     the DOJ or TIGTA.''

                          Proposed Article II

       I acted in good faith in my efforts to comply with all 
     Congressional requests related to the investigations.
       I testified truthfully and to the best of my knowledge in 
     answering questions concerning the search for, and production 
     of, emails related to the investigations.
       The IRS only became aware of the accidental erasure of 
     disaster recovery tapes in 2015, after being notified by 
     TIGTA during its investigation of the Lerner hard drive 
     crash.
       The allegations that I somehow attempted to deceive 
     Congress are unfounded. On June 20, 2014, I testified to the 
     House Ways and Means Committee that ``since the start of this 
     investigation, every email has been preserved. . . .'' That 
     was my honest belief at the time, as I was not yet aware of 
     the Martinsburg erasure.
       I only became aware of the erasure in 2015, after TIGTA 
     briefed the IRS on the matter. On June 23, 2014, I testified 
     to the House Oversight and Government Reform Committee that 
     ``backup tapes from 2011 no longer existed because they had 
     been recycled,'' and that IRS personnel ``went back and 
     looked and made sure'' of this. This was my honest belief, 
     based on briefings with IRS Information Technology (IT) 
     personnel.
       On March 26, 2014, in testimony to the House Oversight and 
     Government Reform Committee, I promised to produce ``all of 
     Lois Lerner's emails.'' As detailed in the discussion above, 
     the IRS made great efforts to

[[Page S3272]]

     produce all available Lerner emails, conducting a broad 
     search at substantial expense. The breadth of the IRS's 
     efforts illustrates the good faith underlying the promise to 
     comply with the Committee's request.

                          Proposed Article III

       The IRS went to great lengths to cooperate with and 
     facilitate the various investigations into the determination 
     process for tax-exempt status.
       The main allegation seems to be that I somehow impeded 
     Congressional investigations by delaying for four months in 
     notifying Congress regarding the Lois Lerner hard drive 
     crash. This is inaccurate. It was never my intent to impede 
     the investigations in any way; to the contrary, the IRS went 
     to great lengths to cooperate with and facilitate the various 
     investigations.
       It is important to note that the Lerner hard drive crash 
     was by no means purposely hidden from Congress. Emails 
     discussing the hard drive crash were included in the 
     substantial production of emails to the Congress months 
     earlier, in 2013. Documents provided included a series of 
     emails to Ms. Lerner in 2011 from the IRS IT division 
     discussing the computer problems she experienced with her 
     hard drive crash and IT's efforts to resolve them.
       It was not until February 2014 that agency attorneys 
     discovered a problem with Ms. Lerner's emails. The IRS 
     attorneys also did not discover this from the e-mail 
     exchanges that had been earlier provided to the Congress. 
     Instead, the discovery was made when IRS attorneys, who were 
     producing emails for the Congressional committees, noticed an 
     apparent chronological ``gap'' in the Lerner emails that had 
     already been provided to Congress in 2013. After making this 
     discovery, IRS officials worked to assess what happened, 
     determine whether and how data was lost, and study how the 
     data might be recovered from other sources.
       I first learned the details of the Lerner hard drive crash 
     in April 2014, and directed IRS personnel to continue the 
     work of determining the extent of the data loss so that a 
     complete description of the problem could be provided outside 
     of the IRS. That work identified 24,000 of Ms. Lerner's 
     emails from the crash period that could be provided to the 
     various investigators. When the IRS completed its assessment 
     of the Lerner email situation in June 2014, we made a full 
     and timely report to the Congressional committees, DOJ and 
     TIGTA.

                          Proposed Article IV

       I oversaw a broad document collection and review to comply 
     with the investigations.
       The gist of this allegation is that I failed to competently 
     oversee the IRS's response to Congressional investigations. 
     There has been no suggestion that I denied IRS personnel the 
     needed resources nor in any other way impeded their efforts 
     to respond to the varied Congressional inquiries. To the 
     contrary, as detailed above, the IRS conducted a broad 
     document collection and review, producing a comprehensive 
     record of the matters under investigation, notwithstanding 
     substantial technical and resource challenges. I received 
     regular reports on the work to complete this effort by IRS 
     lawyers and other personnel. Much of this work was done 
     during my first months on the job. Our goal was to provide 
     TIGTA, DOJ, and the Congressional committees all of the 
     information that they needed to advance and ultimately 
     complete their investigations.


                               CONCLUSION

       While the allegations raised by some Members of the House 
     Oversight and Government Reform Committee are serious and 
     relate to acknowledged errors made by the IRS, the 
     Constitution reserves the use of impeachment for ``treason, 
     bribery, or high crimes and misdemeanors.'' None of my 
     actions relating to the issues above, viewed in light of all 
     the facts, come close to that level.
       I would also note that impeachment has been used only on 
     very rare occasions in the 228-year history of our 
     Constitution. Aside from two Presidents, the only impeachment 
     of a member of the Executive Branch occurred in 1876. If the 
     Committee were to go forward and pursue impeachment in this 
     instance, especially in light of the utter lack of support 
     for the allegations, it would set an unfortunate precedent, 
     diminishing the ability of the Federal government to attract 
     experienced, dedicated people to positions of leadership. 
     Some have suggested that my impeachment would be an 
     appropriate means of holding the IRS accountable for acts of 
     others that occurred before I came to the agency. This 
     approach would make it particularly hard to attract new 
     leaders when they are needed most--when a critical agency is 
     in crisis following serious mistakes, needing both to reform 
     its practices and respond to investigations. That would be a 
     great loss for the government and for the country.
       I want to be clear that, despite being faced with these 
     unwarranted allegations, I remain honored to serve as the IRS 
     Commissioner, and to lead a group of employees who are as 
     dedicated, skillful, energetic and enthusiastic as any group 
     I have had the privilege to work with.
       Chairman Goodlatte, Ranking Member Conyers and Members of 
     the Committee, this concludes my statement.

  Mr. CARPER. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The senior assistant legislative clerk proceeded to call the roll.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________